Michigan Gov. Snyder Calls for Transportation Investment

Says current path is unsustainable.
by | January 29, 2013

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Michigan Gov. Rick Snyder -- like many governors across the country - reiterated his call for greater transportation investment in remarks Tuesday morning at the Governing Outlook in the States and Localities conference in Washington, D.C.

Snyder is the latest state official to make the case for new revenue sources in order to address growing infrastructure needs at a time when the primary tool used to pay for them, the gas tax, is becoming an increasingly unsustainable funding source.

Snyder made the argument that failing to invest in transportation infrastructure today could mean a bigger price tag in the future.

"If we were a business," Snyder said, "it would be a [no-brainer] decision."

Snyder touted the effort as one of his biggest legislative priorities for 2013 but warned that it could be hugely controversial. The state last increased its gas tax in 1997. That trend isn't uncommon, as many state legislators across the country have been reluctant to increase fuel taxes due to their political unpopularity. "This is a great illustration of our broken political culture," Snyder said.

The other component of the plan would be a hike in registration fees. In Michigan, residents are charged vehicle registration fees as a percentage of the value of their vehicles; Snyder has proposed upping those percentages.

In his remarks, Snyder also touted his support for Michigan's system of dealing with financially distressed municipalities, the subject of a Governing cover story last year. Until last year, the state had a controversial emergency manager law that allowed the state government to take over ailing municipalities.

But a new emergency manager law was passed by the state legislature shortly voters last year opted to repeal the old version, which critics said was undemocratic by allowing the state to deprive locally elected officials of almost all their authority.

"We have an emergency manager law that's generating a lot of controversy," Snyder said. "I believe it's a very good law." He said the new system provides an early warning system for financially distressed localities and will give them more flexibility in determining the path to take toward financial solvency.

The new law continues some of the more controversial provisions of its predecessor, including emergency managers' ability to make changes to public employee contracts. But it offers four options for struggling localities: mediation, a consent agreement with the state, bankruptcy, or a state-appointed manager.

Snyder also expressed frustration at the progress Detroit leaders have made in fixing their finances. There is growing concern that the city is inching toward bankruptcy, and last month, Snyder appointed a financial team to audit the city's records.

"We will resolve the financial issues for the city of Detroit," Snyder said.

"The city of Detroit will be a successful community again because it's critically important to our state."


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